NFT whitelists are out of control
I’m here about 12 hours every day Sometimes more and i’ve been on the Server for five days Hey everyone so i brought you here for Some important news you see i’m Releasing my own nft so when john carlo Nft well sir how about right now the Discord is in the twitter bio so just Give that a click oops you almost had it There no just kidding here it is oh Sorry all right all right come in come In Got him all right so if you get into the Discord you’re probably wondering how i Get on the white list right well the First way is to just be there early and Get that o.g roll unfortunately the og List is already filled up mostly by my Friends who knew about this drop before I even announced it but there is another Way to get in all you have to do is Engage with the community you see we’re Trying to build a friendly welcoming Place so just come in and say something Nice doesn’t have to be all the time you Know just every 10 minutes or so for the Next two or three weeks and i’m gonna Have my mods just keep an eye on things Right and if you’re lucky you’ll get Chosen to get one of my cartoon jpegs Okay getting serious there isn’t a Giancarlo nft and some of that might Have sounded like an exaggeration but it Really isn’t that far off and in some
Cases it’s actually a lot worse for Those that are new and kind of confused What i’m referring to is the fact that Most nft drops today use what’s called a White list and this is a way to Determine who actually gets to mint the Nft and if we take an honest look at This we’re gonna see that the system is Completely broken so we are gonna talk About this today and i’ll give you some Possible solutions for how we can get Away from this mess so don’t worry it’s Not just going to be a video of me Complaining now in theory whitelist Makes sense right some projects just get Way too much demand and creators want to Find a way to make sure their followers Get in on the mint and so they devise You know ways to pick out their most Loyal supporters using some obscure Engagement metrics or contests in some Cases these aren’t so bad and they can Actually help out the brand okay like in The example of art contests where people Make derivatives of the nft one viewer Let me know that they were able to get White lists across a few collections Just doing these art contests so i’m a Fan of anything that benefits artists And helps make nfts more inclusive but These white lists are getting more and More ridiculous and we’re now seeing Projects drive up fomo by making it Difficult to even get in the discord in
The first place so what they’ll do is They’ll throw up a discord link on a Tweet for just a few seconds and so you Basically have to have notifications on And be glued to twitter for a chance of Getting in sometimes i even have Contests in exchange for discord invites And so this is like you know competing To then get a chance to compete to get On a whitelist and for those that aren’t Aware whitelist don’t mean you get Anything for free right it just means You get a chance at buying something From them for full price but it gets Even crazier because once you get in the Discord you’re gonna be met with a Leveling up process that includes things Like you know sending out invites to Random people to join the discord or Staying active in chat with a bunch of Messages or even solving complex sudokus Or zenkones because we all know that top Collections like board apes got to where They are today because their community Is filled with elite rubik’s cube Solvers even if you get on the whitelist You still might not be safe depending on The project we’re now starting to see Nfts like galliverse remove whitelist Spots if you go inactive for even two Days presumably they just want to make Sure that people aren’t gaming the System but of course this isn’t gonna Solve that they’re just gonna keep fake
Engaging all the way up to the mint and Then it’ll drop off and last but not Least we’re now seeing projects sell Merch that comes with a chance at Getting a whitelist spot one example of This is from the upcoming drop cartoons Which sold 50 hoodies and other items Where you could potentially get a Discord invite or white list and of Course these things tend to sell out Almost immediately ladies and gentlemen Imagine a closet full of nft merch for Projects that not only probably went to Zero but where you didn’t even get a Chance to mint them now why are people Willing to do almost anything to get on One of these white lists well the simple Answer is that depending on the project A whitelist spot could be worth a lot of Money in the case of hate beasts getting A whitelist spot meant that you could Mint something for 0.2 eth when Everybody knew that you could flip it For a lot more on the secondary market And just as we expected some people were Able to sell these for as much as 15 eth Or about 39 000 when you have a free Market and an opportunity to make you Know basically free money People are going to learn how to game The system and that’s exactly what we’re Seeing right now as this one threat Suggests new project discord servers Have turned into fake conversations of
Low paid workers from the philippines And india grinding whitelist spots for Someone else one example of an ad they Found says this person is looking for Freelancers grinding discord to get Whitelist for nft projects and that They’re willing to pay three to five Dollars per hour in another ad they say That you must have genuine conversations With people in the server this includes 700 minimum messages per day you won’t Be spamming no short or one word chat You can have a few but if i check your Chat and it’s all spams and short Messages that’s no good i’ll end the Contract and in one example of someone Who maybe is working for one of these People they say i’m here about 12 hours Every day sometimes more and i’ve been On the server for five days so we can Assume that there’s a huge economy going On around whitelist right now and if the Original idea was to create real Engagement and to block out flippers Then having a bunch of paid contractors Saying gm to each other 12 hours a day Doesn’t seem like the way okay now we Are going to talk about how we can Potentially solve this but i think first It’s worth discussing how we even got Here in the first place because we can Try and act nostalgic about how things Were before whitelist and pretend like It’s a paradise that we want to go back
To but in truth things were actually Pretty bad as well you see if we take a Time machine back to summer 2021 you’ll Find that whitelists were more unusual And most projects launched by you know Just doing a general mint on a first Come first serve basis and due to Inefficiencies on ethereum this would Quickly lead to a gas war and people Were spending upwards of one eath to Mint something worth .03 each and Usually the people who would win these Gas wars were people who were more tech Savvy and who already had large amounts Of money that they could throw around For gas so as a result many of the nft’s Most loyal followers wouldn’t get a Chance to mint it despite being you know An early supporter and being in the Discord since day one and as you can Imagine people were pissed and when they Couldn’t take anymore they went over the Chains like solana where transaction Fees were less than a penny you people Might not realize this but the solana Nft market was partly driven by people Being sick of gas fees on ethereum and For a while things were good on solana Even without white lists but eventually They faced a different but similar Problem you see a small group of people Began using bots to mint nfts and when You take away the friction of a gas war Then it really just comes down to who
Gets to it first and bots are always Going to be faster than people like you And me so in the end the same thing Happened right collections like aurori Project would sell out in seconds and Early supporters who tended to be less Tech savvy were excluded from popular Mints and so we arrive at the same Problem okay projects need to still find A way to get the mints in the hands of Their earlier supporters like i said Earlier in theory this all makes sense Right if you put the mints in the hands Of your most loyal supporters instead of Flippers then that should lead to a Better community plus if this project Really does have that much demand then This is a great way to make your early Supporters rich and you know that’s the Best way to start off with good morale But clearly we’ve reached the point Where this system is no longer working And nobody’s having fun okay so how do Things get better well i can think of a Few ways okay so one collections could Get bigger two white lists can get Distributed in fairer ways and 3 we just Change the way we do mints altogether on The first point i think as bigger brands Come into the space they’re going to Elect to go with larger collections okay And we already saw adidas do 25 000 nfts That seems to be doing well and if we Get a harry potter or a pokemon they’re
Probably going to be even bigger because Their motivation isn’t really to make a Small group of flippers rich depending On the project they could also do open Additions which is when an infinite Number of people can buy the nft within A limited window and you can do this and Still have scarcity if you include Things like burn mechanics which we did See in pox merge collection which also Started with an open edition but outside Of the big brands the indie collections Seem to be going smaller not bigger and That’s because they want to drive up Fomo and exclusivity and they’ve learned That you know down the road they can Always expand the collection and let More people in they also just might be Scared to do larger collections because In truth you don’t really know how many Entities you’re gonna sell up until Midday so in general i don’t think Larger collections will be the popular Solution now the second option is to Distribute white lists in a fair way and We’ve already seen alpha groups and Launch pads come into prominence and They work to get whitelist spots for Their members in exchange for marketing Or other services i don’t think there’s Anything necessarily wrong with that if Everyone’s aware of the relationship and I only see these alpha groups growing in Influence okay now one option that i
Haven’t seen yet but i think could do Pretty well is giving your whitelist Spots to adjacent collections and so if You’re an anime profile pick you can Give it to people who hold azuki or Oniforce but the key here is to select Only people who are long-term holders i Think this could work great because You’re selecting people who buy in for The long term as opposed to flippers and It’s great marketing because you’re Targeting people that are already in the Same niche okay now the third strategy Is just to do mints in a different way And i’m gonna go through some options And i’ll give you pros and cons for each So one alternative has been to just have A raffle where everyone basically puts Their wallet addresses in a hat and the Winners are chosen at random the problem With this is that there’s virtually no Friction for creating more wallets right They’re free and it’s just a couple Clicks away the most high-profile Collection to use a raffle was Mechaverse and in this case if you Believe people like beanie and i know Many people don’t but the raffle was Likely gamed by people who set up bot Farms to get multiple entries now you Could go a step further and demand that Everybody has to verify their twitter or Their discord but even then there’s Really no friction for creating fake
Accounts as well some people have Suggested to go even further and demand Full kyc for anyone that’s coming in but I think many people aren’t going to be Comfortable giving this information just To buy a jpeg all right another popular Alternative to gas wars has been the Dutch auction the way this works is the Team sets a high starting price for the Nfts and the price slowly starts Trickling down and usually sells out When it reaches a price at the market Deems fair anybody is able to buy in Without needing a white list and the Idea here is that this is the best way To find the true market value of the nft The pros of the dutch auction are that One most of the money raised goes to the Team itself or the dow treasury as Opposed to flippers on the secondary Market and two it lets people get in Without needing to grind a white list And this helps people who have day jobs Or just don’t want to spend you know all Day in discord the downside of dutch Auctions is that if it’s a high demand Project then the price will almost never Go down to an affordable level and so This prices out a group of followers who You know might not have the money but Who would have been willing to get on The white list by trading in their time And also there have been times when so Many people try to get in on the dutch
Auction that it ends up turning into a Gas war anyways and then finally you Have options like the fair launch Protocol on metaplex which has three Stages i’m not gonna read you everything But as you can see it’s complex and even If this was the fairest way i just don’t See it picking up steam with the average Buyer so i don’t think i’ve seen a Perfect solution yet but maybe the Closest is what azuki did which was Basically using a dutch auction with a New smart contract that kept gas fees Low and then having a white list where People could buy one nft at 50 of the Ending price from the dutch auction and Then they took one nft that represents a Pivotal character in the lore and they Fractionalized it so that more people Could participate by owning a much Smaller piece in general i think we just Have to accept that sometimes followers Won’t get in no matter what okay this is Actually how it works in the real world Whenever demand is greater than supply For example i happen to love the nachos They serve at chili’s okay they’re oven Baked and pizza style so you get more Guaranteed toppings on every chip Luckily not many people agree with me But if they did then i would expect long Lines at chili’s and sometimes maybe if The rush gets too crazy they’ll run out Of nachos before i get there and if the
Hype continues day in and day out then Logically they’ll increase the price of The nachos to the point where i can’t Justify buying them so i don’t think It’s reasonable to expect that nfts Exist in a world that’s immune to this Issue and forcing people to spend their Waking hours doing puzzles and fake Engagement isn’t sustainable it’s not Even fun and if we’re honest it doesn’t Work anyways because we’re all just Winking and doing this fake engagement Until the day that we can flip the nft Alright guys that’s it for today thanks For watching and i’ll catch you in the Next video
